Review Problem $17$ #$16($LO$4)$

The introduction of a new product will require a $$400,000$ investment in demonstration models, promotion, and staff training. The new product will increase annual profits by $$100,000$ for the first four years and $$50,000$ for the next four years. There will be no significant recoverable amounts at the end of the eight years. The firm's cost of capital is $13\%.$

Calculate the expected IRR on the proposed investment in the new product. $($Round your answer to $1$ decimal place.$)$

The IRR $\%$

Should the new product be introduced?

The new product be introduced.